AA to the rescue

AA – we don’t want to give away free plugs, but for many readers those initials will mean a breakdown rescue service; it’s the man who eventually arrives to end hours of misery spent on the hard shoulder of a God-forsaken motorway. On a more sombre note, the initials stand for another rescue service, one that tackles real misery – Alcoholics Anonymous. For investors, AA can also stand for a rescue service of sorts – the ‘accruals anomaly’. Understand what goes on behind those alliterative initials and the accruals anomaly can bring profit-making opportunities. More likely, as we explain, it is a rescue service – helping to spare an investor’s equity portfolio from losses that might have been incurred. It provides an early warning system against trouble, helping to avoid losses, and that is every bit as good as capturing profits.